Supporters of electronic trading believe cutting the need for a physical presence at the IPE will allow a trader to work in any number of markets from any location. They also claim that on-screen trading ensures a more transparent and easier to regulate market.

Andy Swaine, a broker with ADM Investor Services in London, said the electronic process brings several benefits, such as the flow of prices and technical and fundamental market information.

"We have made a quite deliberate decision to focus upon that which we perceive to be the future of derivatives trading," said Swaine, who trades energy derivatives exclusively on IPE's electronic system.

The switch to full electronic trading was a condition of IPE's takeover in 2001 by the Intercontinental Exchange. The IPE began the process in November when it ditched the morning open outcry session, leaving only the afternoon session.

Nymex President James Newsome, however, said during a visit to London in February that the Nymex will offer open outcry trading as long as customers demand it, and dismissed suggestions that it would alienate newer players such as hedge funds that prefer electronic trading.

Peter Fusaro, chairman of the advisory firm Global Change Associates in New York, called the IPE's decision a "big mistake."

"It's way too premature. Energy is an information-intensive business," he said. "You can't execute strategy on screen. They have failed to understand the physicality of the market."

Fusaro said there would be room for only one energy market in Europe, and Nymex would emerge the winner.

"The IPE is going to lose a lot of liquidity and potentially, eventually, be bought by Nymex," he said.

The closure of the IPE pit leaves the London Metal Exchange as the only commodities pit or ring left in London. The LME has said it has no current plans to abandon its open outcry system, which is used by 11 dealing firms and is supplemented with telephone and electronic trading.